RR Kabel shares edge higher as Citi recommends 'buy' with a hiked target price

RR Kabel shares have slipped over 6 percent in the past month.

Share of RR Kabel rose almost a percent to Rs 1,618 in early trade on September 4 after international brokerage Citi maintained its buy rating and hiked the target price citing robust growth prospects.

With a target price of Rs 2,300, it implies a massive upside of over 41 percent from the current market levels. The stock is currently way off its 52-week high of Rs 1,901 on the National Stock Exchange.

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Analysts at Citi are bullish because the management is confident of achieving a 60-80 basis points expansion in EBIT margins for the wires and cables segment in FY25. They also expect 25-30 percent year-on-year growth in the fast-moving electrical goods (FMEG) segment, targeting breakeven in the next 3-4 quarters, and 20 percent year-on-year growth in exports for FY25.

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The wires and cables industry is benefiting from strong structural tailwinds, driven by infrastructure capex, PLI schemes, and a real estate upcycle in India, Citi added.

In early June, there was a block deal in the RR Kabel stock where around 56 lakh shares, representing 5 percent stake in RR Kabel changed hands. The stock of this wire and cable maker listed on bourses at a premium in September 2023. On the NSE, RR Kabel share price was listed at Rs 1,180 per share, 14 percent higher than the issue price of Rs 1,035, and on the BSE, RR Kabel share price was listed at Rs 1,179 per share.

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RR Kabel shares have slipped over 6 percent in the past month.

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